01/30/2014 12:31PM

Pennsylvania propsal would cut racing's share of casino revenue by $250 million

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A Pennsylvania legislator representing a suburban Philadelphia district has introduced a bill that would re-direct $250 million a year from casino subsidies flowing to the state’s racing industry to school funding.

Rep. Todd Stephens of Montgomery County, said that the intent of the bill was to provide property-tax relief to homeowners in 211 school districts that receive less than 35 percent of their funding from the state. Those districts are typically high-income areas where the tax base is wealthy enough to provide the majority of funding for schools.

In a statement, Stephens was critical of the racing subsides, citing purses won by Sheikh Mohammed al Maktoum, the Dubai monarch and owner of the Godolphin and Darley racing operations, and “countless out-of-state racehorse owner millionaires.”

“We have a constitutional obligation to fund our schools; not to provide economic incentives for one segment of one industry,” Stephens said. “Rather than funding the pastime of the world’s wealthy and elite, I believe these funds should be used to fulfill our moral and constitutional obligations to our children and to help reduce the burden of local property taxpayers in 211 school districts.”

Pennsylvania’s Race Horse Development Fund, which receives approximately 18 percent of the net revenue from casinos in the state, has distributed an average of slightly more than $250 million a year to Thoroughbred and Standardbred purses since its creation eight years ago. Stephens’s bill would allow the development fund to keep any money generated after the school districts receive their $250 million.

The issue of the amount of casino money flowing to the racing industry in Pennsylvania has been criticized in the past, most prominently by Pennsylvania Gov. Tom Corbett, who in the middle of 2012 argued for a $72 million annual diversion of the fund’s money to shore up job-creation programs. The provision was not included in the budget passed by legislators.